Tag Archive: Southern California

Recently, I attendedMobility 21, the Southern California transportation coalition, and it reminded me of the sheer relevance of transportation. No manufacturer can operate without transportation: distributors are out of business without trucks dropping off and picking up, healthcare would stop functioning and our frequent Amazon orders would be a thing of the past. In essence, everything would come to a grinding halt!

Certainly, trucks are what we typically think about when it comes to transportation. They account for $722 billion in freight flows with Canada and Mexico, for example. Whereas rail still accounts for $174 billion (not pocket change). The ports are our gateway to the rest of the world (and the Los Angeles ports alone bring in 40% of the U.S. volume). Air carries an impressive number of packages especially with the rise of e-commerce. UPS and FedEx are expanding at amazing rates, especially at Ontario airport, the hub of e-commerce activity. For example, during the 2017 peak season, this region of UPS alone processed 13.1 million packages!

At Mobility 21, there were some interesting statistics throw out:

AAA has 60,000 service calls per day

Transportation has a $700 billion dollar economic impact on Southern California and accounts for 1/3 of the jobs in Southern CA!

350 billion miles each year are driven in California

The number of trucks is expected to go from 1.8 trillion to 3.9+ trillion by 2045

And the list goes on….

What Should We Consider and/or What Impacts Could Arise?At a minimum, why not take a step back to think about your transportation network? What does it look like? How do you receive materials and products? Do you use the ports? Air? Rail? Undoubtedly, you use trucks! How expansive is your network? Are there many players involved? Since it could cause your operations to cease, it makes sense to find out!

Next, think about what you’d like your transportation network to deliver. Do your customers expect rapid deliveries and “above and beyond” service? If so, who is your partner in ensuring this occurs?

Your transportation partners are your last face to your customer. And, in today’s marketplace, there is a significant demand and challenges your transportation partners must navigate. If you plan to be successful, you must stay on top of your transportation network and partners. Are you attractive to them? Perhaps we better think about that further….

We are all so busy that it can be hard to find time to give back. Yet, the future of our profession, future leaders and our region is at stake. Making this a priority during your day may not be as difficult as you think.

Choose a way that works for you.Some people prefer to donate time. Others prefer to donate money. And others donate expertise.

I started this journey because one of my colleagues,Ellen Kane, who has to be one of the most helpful people I know (and therefore there is no way to say no to such a wonderful person) asked me to participate with the first APICS Western region student case competition (with just a hand full of students from three colleges). Fast-forward 10+ years…. We led the competitions together with over 100 students from universities around the globe (from the western region of the U.S. to Canada to China and beyond).

To give an idea of the types of activities you might get involved with in your profession, community or with future leaders, here are thegiving backpriorities of LMA Consulting:

1) Manufacturing/ Supply Chain Community

2) Southern CA Community

3) Students and the future of the profession

Within these categories, here are some of the examples of our activities. Hopefully they will prompt ideas for you:

MCIE (Manufacturing Council of the Inland Empire): Certainly this group also has a focus on manufacturing in Inland Southern California to contribute to the economy of the area. For MCIE, we lead the Innovation Awards and partner and recognize manufacturing in the region.

APICS Inland Empire & Universities/ Colleges in the I.E.: APICS is the leading trade association for supply chain and operations professionals. Our goal is to provide value to manufacturers and distributors in the area as well as to students/future leaders (Harvey Mudd, Cal Poly Pomona, CSUSB, UCR, University of LaVerne, Drucker & Norco College).

Student internships & mentoring (Pomona College & theDrucker School): We also partner with students at Pomona College to provide internships in research and business topics and with students at the Drucker School to mentor women in supply chain.

University of LaVerne Board of Advisors: As part of this role, our goal is to advise the business school, participate with the CEO Summit and contribute to the committee focused on advancing women in the business school.

One of the best pieces of advice we’ve received is to start small. You can make a difference by giving back in a small way and expand where it makes sense for you. There are no competitions when it comes to giving back. Do it in a way that makes sense to you. It doesn’t matter what anyone else thinks. Also, you might have completely different interests. For example, my business partner in theSociety for the Advancement of Consulting contributes by volunteering for an association that focuses on diabetes. I have colleagues who give back by taking care of aging parents.

No matter your interests, it is likely to give you a bit of diversity in your life.

OurAPICS Inland Empire chapter hosted the 12th executive panel and networking symposium (over 7 years) on the theme of “Managing Rapid Growth when Manufacturing and Distribution are HOT”. We had a fabulouspanel (clearly enjoying the conversation – see below) of manufacturing and supply chain CEOs and experts. Thanks to theAPICS BOD andKash Gokli and the Harvey Mudd team for putting on such a value-packed day!

Overall, we discussed the power of manufacturing and supply chain in today’s environment. In the era of the customer, it is all about the customer experience, rapid deliveries, e-commerce and responsiveness. From that point-of-view, Southern CA has enormous opportunity since it is larger than all but 5 or 6 states in terms of population – and customers/ consumers! We also have access to technology, high-tech skills and more. The tax law gives us additional great advantages. The only downer is the lack of support from the state California.

In addition, the panel talked about ways to thrive regardless of your circumstances. For example,Mirna Elnar (CEO of Regal Spas) wanted to sell into Brazil but ran into horrible tariffs. So, she collaborated with a local Brazilian company to achieve success. Several of the themes boil down to the following: Innovation. Culture. People. Technology. Metrics.

What Should We Consider and/or What Impacts Could Arise?First and foremost, we are in the “right” fields – manufacturing and supply chain (along with related disciplines such as IT/technology and Organizational development) are HOT and there is vast opportunity. However, we must take advantage of the opportunity and have a voice! Would we prefer to leave our future up to the California lawmakers (for example) or take a proactive approach? Certainly our panel encouraged us to be proactive.

Think about your supply chain: How are you positioned in comparison to your customers’ locations, your end users (consumers, patients, or the base player in your industry such as Boeing) and how well positioned are you to create value-added customer experiences? What do you expect to happen in the future? Are you still positioned effectively? Are you prepared for growth?

One of the most common issues our clients call about is unexpected demand: Are your products and services going to be in the right place at the right time, in relevant ‘packaging’ (meaningful to your customers’ current needs) at the right margins and cash flow?

Many of these questions go back to aligning your demand with your capacity, starting with your people. It takes a minute to lose a customer – and a LONG TIME to win them back.

Keep innovation and future disruptors top of mind. The last thing any of us wants is to come up with the best strategies and plans that are outdated by the time they are implemented! If you’d like to talk about performing an audit of your supply chain positioning, contact us.

According to Industry Week, we have the highest number of factory jobs since 2008! We have reached over 12.6 million people employed by the sector. This is all the more impressive when we consider the significant rate of automation and deployment of technological advances occurring the last several years.

In the era of the customer, executives are locating manufacturing in close proximity to their customers. Since customers expect rapid deliveries and high levels of customization, it is making more and more sense to locate manufacturing in Southern California and especially the Inland Empire with lower costs, extra space and access to top talent. Are you prepared to grow?

What Should We Consider and/or What Impacts Could Arise?Since manufacturing is transitioning from a necessarily evil into a strategic advantage supporting superior customer service, it is well-worth thinking about how you are positioned. A

re you leveraging the opportunity if you are well-located by a significant customer base? What can you offer to provide customized, specialized experiences for your customer? Undoubtedly, the executives thinking this way will surpass their competition.

Similar to retail shopping – if the store you go to doesn’t have what you want customized for you when you want it, what do you do? Buy from the competition! We don’t wait for products to arrive on a boat from China patiently.

Take note if you would pay more for customized, quick service. I find that I am willing. Are your customers?

IE Forecasts
Since we attended not one but two economic forecast events last week (one hosted by Claremont McKenna and one hosted by the Inland Empire Economic Partnership), we thought it made sense to share the take-aways:

The economy has never looked better especially in the Inland Empire – All the signs point up. Even though folks are concerned about when the other shoe will drop, from an economic point-of-view, all appears positive.

Jobs at record levels with the Inland Empire leading California – We are virtually at zero unemployment. Perhaps we need to be concerned about retaining our top talent!

Tax law is a boost for manufacturers! The Claremont McKenna economic forecast showed the progression and the definite boost from the tax law. Not only is it increasing profit but it is also encouraging investment. It is likely to lead to interest rate increases as the Fed meets in 2018.

The Inland Empire is on fire! First, did you know that just the Inland Empire is larger than 25 of the 50 states, let alone if we added the rest of Southern California? It is leading California in many respects – job growth for one. And it is an attractive place to be in business, surrounded by tons of customers/ consumers, lower wages on average, more space availability at lower prices than Los Angeles and Orange County, access to a growing Ontario airport (with a new international direct flight to China soon) and with significant advances in technology and access to skills.We believe the IE is the place to be in manufacturing and distribution today! Amazon agrees since they have 21 of their 26 million square feet in Southern CA in the IE!

And a few cautionary comments… There was a panel of CEO’s at the Claremont McKenna economic forecast that spoke about the California minimum wage hikes. These are definitely not popular with manufacturers and distributors who utilize talent in the lower pay scales – challenging to compete with other states of course. At the IEEP, there was talk about the pace of automation and technology. From a profit, customer and competitive perspective, there are lots of advantages. In manufacturing, this is already prevalent and the impacts aren’t expected to be dramatically different. However, in distribution, they are just getting started. Although there are several positive points, it will be disruptive in terms of jobs and there will be a need to redeploy these blue collar employees.Lastly, trade can certainly impact the IE – stay tuned. In talking with two IEEP manufacturers, one said the tariffs helped, and the other said it could go well or really, really poorly depending on a few factors.